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  • So if I was to ask you

  • what the connection between

  • a bottle of Tide detergent and sweat was,

  • you'd probably think that's the easiest question

  • that you're going to be asked in Edinburgh all week.

  • But if I was to say that they're both examples

  • of alternative or new forms of currency

  • in a hyperconnected, data-driven global economy,

  • you'd probably think I was a little bit bonkers.

  • But trust me, I work in advertising.

  • (Laughter)

  • And I am going to tell you the answer,

  • but obviously after this short break.

  • So a more challenging question is one

  • that I was asked, actually, by one of our writers

  • a couple of weeks ago, and I didn't know the answer:

  • What's the world's best performing currency?

  • It's actually Bitcoin.

  • Now, for those of you who may not be familiar,

  • Bitcoin is a crypto-currency, a virtual currency, synthetic currency.

  • It was founded in 2008 by this anonymous programmer

  • using a pseudonym Satoshi Nakamoto.

  • No one knows who or what he is.

  • He's almost like the Banksy of the Internet.

  • And I'm probably not going to do it proper service here,

  • but my interpretation of how it works is that

  • Bitcoins are released through this process of mining.

  • So there's a network of computers that are challenged

  • to solve a very complex mathematical problem

  • and the person that manages to solve it first gets the Bitcoins.

  • And the Bitcoins are released,

  • they're put into a public ledger called the Blockchain,

  • and then they float, so they become a currency,

  • and completely decentralized, that's the sort of

  • scary thing about this, which is why it's so popular.

  • So it's not run by the authorities or the state.

  • It's actually managed by the network.

  • And the reason that it's proved very successful

  • is it's private, it's anonymous, it's fast, and it's cheap.

  • And you do get to the point where there's some wild fluctuations with Bitcoin.

  • So in one level it went from something like 13 dollars

  • to 266, literally in the space of four months,

  • and then crashed and lost half of its value in six hours.

  • And it's currently around that kind of

  • 110 dollar mark in value.

  • But what it does show is that it's sort of gaining ground,

  • it's gaining respectability.

  • You get services, like Reddit and Wordpress

  • are actually accepting Bitcoin as a payment currency now.

  • And that's showing you that people

  • are actually placing trust in technology,

  • and it's started to trump and disrupt

  • and interrogate traditional institutions

  • and how we think about currencies and money.

  • And that's not surprising, if you think about

  • the basket case that is the E.U.

  • I think there was a Gallup survey out recently

  • that said something like, in America,

  • trust in banks is at an all-time low, it's something like 21 percent.

  • And you can see here some photographs from London

  • where Barclays sponsored the city bike scheme,

  • and some activists have done some nice piece

  • of guerrilla marketing here and doctored the slogans.

  • "Sub-prime pedaling." "Barclays takes you for a ride."

  • These are the more polite ones I could share with you today.

  • But you get the gist, so people have really started

  • to sort of lose faith in institutions.

  • There's a P.R. company called Edelman,

  • they do this very interesting survey every year

  • precisely around trust and what people are thinking.

  • And this is a global survey, so these numbers are global.

  • And what's interesting is that you can see that

  • hierarchy is having a bit of a wobble,

  • and it's all about heterarchical now,

  • so people trust people like themselves more

  • than they trust corporations and governments.

  • And if you look at these figures for the more developed markets

  • like U.K., Germany, and so on, they're actually much lower.

  • And I find that sort of scary.

  • People are actually trusting businesspeople

  • more than they're trusting governments and leaders.

  • So what's starting to happen, if you think about money,

  • if you sort of boil money down to an essence,

  • it is literally just an expression of value, an agreed value.

  • So what's happening now, in the digital age,

  • is that we can quantify value in lots of different ways

  • and do it more easily,

  • and sometimes the way that we quantify those values,

  • it makes it much easier

  • to create new forms and valid forms of currency.

  • In that context, you can see that networks like Bitcoin

  • suddenly start to make a bit more sense.

  • So if you think we're starting to question

  • and disrupt and interrogate what money means,

  • what our relationship with it is, what defines money,

  • then the ultimate extension of that is,

  • is there a reason for the government to be in charge

  • of money anymore?

  • So obviously I'm looking at this through a marketing prism,

  • so from a brand perspective,

  • brands literally stand or fall on their reputations.

  • And if you think about it, reputation has now become a currency.

  • You know, reputations are built on trust,

  • consistency, transparency.

  • So if you've actually decided that you trust a brand,

  • you want a relationship, you want to engage with the brand,

  • you're already kind of participating in lots of new forms

  • of currency.

  • So you think about loyalty.

  • Loyalty essentially is a micro-economy.

  • You think about rewards schemes, air miles.

  • The Economist said a few years ago that

  • there are actually more unredeemed air miles in the world

  • than there are dollar bills in circulation.

  • You know, when you are standing in line in Starbucks,

  • 30 percent of transactions in Starbucks on any one day

  • are actually being made with Starbucks Star points.

  • So that's a sort of Starbucks currency

  • staying within its ecosystem.

  • And what I find interesting is that Amazon

  • has recently launched Amazon coins.

  • So admittedly it's a currency at the moment that's purely for the Kindle.

  • So you can buy apps and make purchases within those apps,

  • but you think about Amazon,

  • you look at the trust barometer that I showed you

  • where people are starting to trust businesses,

  • especially businesses that they believe in and trust

  • more than governments.

  • So suddenly, you start thinking,

  • well Amazon potentially could push this.

  • It could become a natural extension,

  • that as well as buying stuff --

  • take it out of the Kindle -- you could buy books, music,

  • real-life products, appliances and goods and so on.

  • And suddenly you're getting Amazon, as a brand,

  • is going head to head with the Federal Reserve

  • in terms of how you want to spend your money,

  • what money is, what constitutes money.

  • And I'll get you back to Tide, the detergent now,

  • as I promised.

  • This is a fantastic article I came across in New York Magazine,

  • where it was saying that drug users across America

  • are actually purchasing drugs

  • with bottles of Tide detergent.

  • So they're going into convenience stores,

  • stealing Tide,

  • and a $20 bottle of Tide

  • is equal to 10 dollars of crack cocaine or weed.

  • And what they're saying, so some criminologists

  • have looked at this and they're saying, well, okay,

  • Tide as a product sells at a premium.

  • It's 50 percent above the category average.

  • It's infused with a very complex cocktail of chemicals,

  • so it smells very luxurious and very distinctive,

  • and, being a Procter and Gamble brand,

  • it's been supported by a lot of mass media advertising.

  • So what they're saying is that drug users are consumers too,

  • so they have this in their neural pathways.

  • When they spot Tide, there's a shortcut.

  • They say, that is trust. I trust that. That's quality.

  • So it becomes this unit of currency,

  • which the New York Magazine described

  • as a very oddly loyal crime wave, brand-loyal crime wave,

  • and criminals are actually calling Tide "liquid gold."

  • Now, what I thought was funny was the reaction

  • from the P&G spokesperson.

  • They said, obviously tried to dissociate themselves from drugs,

  • but said, "It reminds me of one thing

  • and that's the value of the brand has stayed consistent." (Laughter)

  • Which backs up my point and shows he didn't even

  • break a sweat when he said that.

  • So that brings me back to the connection with sweat.

  • In Mexico, Nike has run a campaign recently

  • called, literally, Bid Your Sweat.

  • So you think about,

  • these Nike shoes have got sensors in them,

  • or you're using a Nike FuelBand

  • that basically tracks your movement, your energy,

  • your calorie consumption.

  • And what's happening here, this is where you've actually

  • elected to join that Nike community. You've bought into it.

  • They're not advertising loud messages at you,

  • and that's where advertising has started to shift now

  • is into things like services, tools and applications.

  • So Nike is literally acting as a well-being partner,

  • a health and fitness partner and service provider.

  • So what happens with this is they're saying, "Right,

  • you have a data dashboard. We know how far you've run,

  • how far you've moved, what your calorie intake, all that sort of stuff.

  • What you can do is, the more you run, the more points you get,

  • and we have an auction where you can buy Nike stuff

  • but only by proving that you've actually used the product to do stuff."

  • And you can't come into this. This is purely

  • for the community that are sweating

  • using Nike products. You can't buy stuff with pesos.

  • This is literally a closed environment, a closed auction space.

  • In Africa, you know, airtime has become

  • literally a currency in its own right.

  • People are used to, because mobile is king,

  • they're very, very used to transferring money,

  • making payments via mobile.

  • And one of my favorite examples from a brand perspective

  • going on is Vodafone, where, in Egypt,

  • lots of people make purchases in markets

  • and very small independent stores.

  • Loose change, small change is a real problem,

  • and what tends to happen is you buy a bunch of stuff,

  • you're due, say,

  • 10 cents, 20 cents in change.

  • The shopkeepers tend to give you things like an onion

  • or an aspirin, or a piece of gum,

  • because they don't have small change.

  • So when Vodafone came in and saw this problem,

  • this consumer pain point, they created

  • some small change which they call Fakka,

  • which literally sits and is given

  • by the shopkeepers to people,

  • and it's credit that goes straight onto their mobile phone.

  • So this currency becomes credit, which again,

  • is really, really interesting.

  • And we did a survey that backs up the fact that,

  • you know, 45 percent of people

  • in this very crucial demographic in the U.S.

  • were saying that they're comfortable using

  • an independent or branded currency.

  • So that's getting really interesting here,

  • a really interesting dynamic going on.

  • And you think, corporations

  • should start taking their assets and thinking of them

  • in a different way and trading them.

  • And you think, is it much of a leap?

  • It seems farfetched, but when you think about it,

  • in America in 1860,

  • there were 1,600 corporations issuing banknotes.

  • There were 8,000 kinds of notes in America.

  • And the only thing that stopped that,

  • the government controlled four percent of the supply,

  • and the only thing that stopped it

  • was the Civil War breaking out,

  • and the government suddenly wanted to take control of the money.

  • So government, money, war, nothing changes there, then.

  • So what I'm going to ask is, basically,

  • is history repeating itself?

  • Is technology making paper money feel outmoded?

  • Are we decoupling money from the government?

  • You know, you think about, brands are starting to fill the gaps.

  • Corporations are filling gaps that governments can't afford to fill.

  • So I think, you know, will we be standing on stage

  • buying a coffee -- organic, fair trade coffee -- next year

  • using TED florins or TED shillings?

  • Thank you very much.

  • (Applause)

  • Thank you. (Applause)

So if I was to ask you